MORTGAGE BANKING ACTIVITIES (Tables)

9 Months Ended

Sep. 30, 2019

The principal balances of mortgage loans serviced for others are as follows:

	September 30, 2019		December 31, 2018
	(Dollars in thousands)
Mortgage loan portfolios serviced for:
FHLMC	$	1,002,212	$	1,016,097
FNMA		451,762		347,294
Private investor		10,640		15,049

Activity for capitalized mortgage servicing rights, included in other assets, was as follows:

	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2019			2018			2019			2018
	(Dollars in thousands)
Balance, beginning of period	$	8,191		$	6,942		$	7,704		$	6,681
Originations		1,138			928			2,624			2,231
Amortized to expense		(702	)		(477	)		(1,701	)		(1,519	)
Balance, end of period		8,627			7,393			8,627			7,393
Less valuation allowance		(1,901	)		(26	)		(1,901	)		(26	)
Net balance	$	6,726		$	7,367		$	6,726		$	7,367

Activity in the valuation allowance for mortgage servicing rights was as follows:

	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2019			2018			2019			2018
	(Dollars in thousands)
Balance, beginning of period	$	(1,565	)	$	(20	)	$	(70	)	$	(9	)
Impairment charges		(336	)		(6	)		(1,831	)		(26	)
Recoveries		—			—			—			9
Balance, end of period	$	(1,901	)	$	(26	)	$	(1,901	)	$	(26	)

Key economic assumptions in measuring the value of mortgage servicing rights at September 30, 2019, and December 31, 2018, were as follows:

	September 30, 2019	December 31, 2018
Weighted average prepayment rate	287 PSA	145 PSA
Weighted average life (in years)	4.96	7.26
Weighted average discount rate	11.00%	11.00%